PRODUCT BRIEF 2010

The Registry Collection® Luxury Exchange Product Brief

BEGINNING OUR EIGHTH YEAR AS THE LEADER IN LUXURY EXCHANGE

THE LUXURY LEISURE MARKET: THEN AND NOW

The Registry Collection program is the industry’s first luxury global exchange network product, serving more than 30,000 member families. The program has more than 175 destination properties, either accessible for exchange or under development, in nearly 30 countries on six continents. It has operated as a division within RCI since 2002.

Eight years ago, RCI, the worldwide leader in vacation exchange and European vacation rentals, recognized the emergence of a new type of luxury leisure market. While luxury markets had always existed, this new luxury segment was unique. One key difference was that this luxury segment consisted of shared vacation ownership products, which have come to be known as fractional real estate.

EVOLUTION OF THE NEW LUXURY MARKET

The “new” luxury market isn’t new at all. In fact it’s existed for the past quarter-century. As early as 1984, the “boomer” generation, born between 1946 and 1964, began to enter a stage of life in which they had more disposable income than any of their predecessors. The behavior and needs of this new luxury market were different from the luxury markets that came before them. According to Pamela Danziger in her 2005 book, Let Them Eat Cake: Marketing Luxury to the Masses—As Well as the Classes, affluent boomers have unique views on what constitutes luxury and how to treat their wealth, stating that theirs is a more self-directed, inward-focused definition of “living the good life.” Boomers in this affluent group have already acquired many of the material trappings in life, and are increasingly drawn toward unique, life-changing experiences.

LUXURY REDEFINEDThe most recent perceptions of luxury have evolved into the way products make the consumer feel. In fact, many of the products and services consumed by boomers that they consider luxury are more affordable than in their parents’ day. The shifting paradigm indicates a move from the treatment of luxury as a thing to an experience; less about what these consumers own, and more about the extent to which a particular luxury offers pleasure and enjoyment. This shift is having a profound impact on the marketplace and businesses are now positioning their luxury products to appeal to this new generation of luxury-seekers. In today’s shifting economic climate, new trends continue to emerge in the ultra high-end market. Because luxury is and always has been a cyclical business, The Registry Collection® program continues to take the long-term view in its business approach, ensuring that our product not only survives but thrives.

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MAINTAINING OUR LEAD IN THE NEW ECONOMY

As businesses worldwide try to put the recession behind them, fractional real estate seems to be showing some signs of recovery as well. Dr. Richard Ragatz, president of Oregon-based Ragatz Associates, a vacation ownership consulting firm, expresses cautious optimism as the economy continues to rebound, and believes that the economic upturn will be good news for developers and sales in the coming year.

“Most experts in the global resort real estate industry fully expect the fractional interest industry to rebound in parallel with the national economy,” says Ragatz. “Hopefully, the rebound will begin in 2010. A wide variety of economic and social indicators suggest a bright future for the fractional interest industry over the long-term, especially in comparison with whole-ownership resort real estate. More and more high-end, educated consumers will appreciate the value proposition of shared ownership, the wealth of associated consumer services and benefits, the no-hassle maintenance, and other advantages.

Ragatz added, “All of our consumer research via focus groups and surveys strongly indicates an ever-increasing interest in shared ownership. Such research also documents a growing demand amongst existing and potential fractional interest owners for external trading opportunities, as are nicely offered by The Registry Collection® program.”

As the U.S. real estate industry begins to show signs of recovery, The Registry Collection program is working with developers to reinforce this optimism. “High-end developers with projects planned in ‘A’ locations are in a good position to take advantage of the anticipated pent-up demand for fractional real estate,” says Gregg Anderson, vice president, The Registry Collection program. “These developers in general are more conservative today in their project planning and know that potential buyers are seeking the best combination of quality, experience and value. Now more than ever they see the sales benefit in providing their owners with vacation exchange options for the luxury leisure real estate they purchased. The Registry Collection program can play a very important role by providing that external exchange engine.”

The Registry Collection program also seeks to provide developers with a true competitive advantage, offering inclusion into the largest luxury exchange network in the world, as well as a wide range of services and solutions to enhance an owner’s luxury vacation experience while helping to grow business.

Depending on the need, The Registry Collection program can refer developers to a network of subject-specific industry leaders who can provide services such as feasibility studies and sales and marketing solutions, and the opportunity to learn how affiliation with our exchange platform may help drive income and lifestyle-qualified lead generation.

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BRINGING VALUE TO THE LUXURY MARKETIn the dawn of this new decade, changes in the industry include a shift in the perception of what constitutes luxury. According to a recent 2010 Trend Report at trendwatching.com, a firm that monitors global industry for consumer trends and ideas to enhance future business and consumerism, as luxury consumers place increasing emphasis on experience rather than on material goods, they seek what’s exclusive, unique, specialized, and personalized. How is The Registry Collection® program aligned with this trend?

“The definition of luxury can mean different things to different people at different times,” states Anderson. “While all of our properties offer beautifully appointed accommodations, it is the combination of services, amenities and activities that create memorable experiences. So whether it is skiing in the Rockies, kayaking in Costa Rica or joining a photo safari in South Africa, The Registry Collection program can help deliver that lasting vacation memory.”

The wealthy may be spending again, but today they’re more value-driven and selective. Affluent shoppers want to achieve a feeling that whatever they buy is worth it, and research indicates that new consumers are more discerning in their product choices. According to Anderson, when it comes to developers and consumers, The Registry Collection program offers a clear value prospect.

“High net-worth households definitely have felt the effect of the recent economic challenges,” he states, “And while many of those households can still afford to purchase wholly owned vacation homes, many became aware of the opportunity to buy just the amount of real estate that corresponded to their vacation needs. By buying a fraction of the interest, in many cases people are able to purchase an even more luxurious resort home than they would have been able to if they bought one outright. Fractional ownership is a win-win for all.”

“…On the development side…in the sales of a fractional component today, so many of the people that we see, if they’re looking for a shorter term ownership, are really concerned about flexibility. And flexibility not only in the piece of time in their home club, but the flexibility to go elsewhere. So consequently, the advantage of The Registry Collection program having a number of different locations is a major selling point for us.”

-Richard Korowicki, Property Advisor, Pronghorn/Bend, OR

“The need for flexibility, the need for alternatives, the need for ultra-deluxe personalized service was always there. The Registry Collection program does that. It fills that need.”

-Gustavo Ripol, Director, Club at Presidente/Cabo, Mexico

In today’s market, service, delivery and innovation will play a key role in helping developers maintain an edge, and developers will need to offer a robust, global exchange platform for their owners. A truly beneficial exchange solution should include a significant portfolio of available resort properties from which to choose.

The Registry Collection® program offers its members a geographically diverse set of possibilities for their next exchange. From its beginning, The Registry Collection program has positioned itself to deliver superlative quality to its members, and to help developers to position their properties for unprecedented business growth—while helping to ensure that their owners enjoy that same level of quality, exclusivity and unsurpassed service.

Backed by RCI’s decades of experience in the leisure real estate market, The Registry Collection program is able to provide more to its affiliates than any of its competitors, working at every level to facilitate success for developers and exceptional vacation experiences for their owners. The success of these relationships relies on a firm foundation of trust, which at The Registry Collection program is earned daily.

“We continually ask our members which destinations are most important to them, and we do our best to provide exchange inventory in those locations,” says Anderson. “We also offer personalized one-on-one phone service through our dedicated team of consultants at each of our regional call centers. In addition, we provide our members with opportunities for non-exchange rental accommodations and luxury lifestyle activities and services. Our developers recognize that this dedication to our members—their owners—can often be the difference in closing a sale.”

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INNOVATION KEEPS US GROWINGMore than 175 properties are available through the The Registry Collection® program and are either accessible for exchange or under development. This breadth and diversity of destinations enables the continued development of innovative products and services. We continually raise the bar with our commitment to customer service, which includes a team of dedicated Account Service associates who address the needs of our members exclusively. Finally, we offer our members the flexibility and value they expect, including significant savings through close-date exchange opportunities at select properties.

In addition, The Registry Collection program continues to distinguish itself with its commitment to provide 24/7 Concierge Service for members, as well as offering access to specially negotiated pricing and benefits from our select group of Collection Partners.

SOLID SERVICES FOR A CHANGING SEGMENTIn 2002, RCI made the commitment to dedicate the time and resources necessary to create an exchange program tailored specifically to meeting the needs and exacting standards of the new luxury segment. Based on the principles of creating an experiential product for this emerging segment, The Registry Collection exchange program was built based on the following tenets:

The product will be global in scope The product will be experiential in nature There will be an unwavering commitment to providing the consumer with luxury products and accommodations The service delivery will be best in class

GLOBAL EXCHANGEToday’s luxury consumers enjoy more available vacation time than their parents, and also seek a more global vacation experience. They are more ready to travel and have more flexibility with their planning. With affiliates on five continents, The Registry Collection® exchange program is a truly global option for luxury shared ownership products and their owners who choose to exchange their property. With a strong commitment to serve its growing international owner base and to have a local presence when members travel, the service centers for The Registry Collection luxury program are taking member calls in: Indianapolis Cork, Ireland Mexico City Johannesburg, South Africa Singapore

The Registry Collection exchange network includes affiliated luxury leisure properties in Canada, the United States, the Caribbean, Mexico, Uruguay, Belize, South Africa, France, United Arab Emirates, Spain and Italy. Throughout 2010, new affiliations are anticipated in a number of exciting new destinations, further expanding the world’s largest international portfolio of luxury exchange opportunities for members of The Registry Collection program.

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2004

222 879

17,909

26,568

30,938

33,041*

0

5000

10000

15000

20000

25000

30000

2005 2006 2007 2008 2009

35000

The Registry Collection Global Paid Membership

* Unaudited number as of 12/31/09

10

50

30

70

130

110

90

150

2002 2003 2004 2005 2006 2007 2008 2009

56

10

39

76

93

122

141*

The Registry Collection Global Affiliations

All Signed Contracts

56

10

39

76

93

122

141*

* Unaudited number as of 12/31/09

EXPERIENTIAL SERVICES

Today’s luxury market requires an exchange program that provides far more than the best in accommodations. Luxury exchanges for other leisure assets such as destination clubs, resorts, and luxury yachts is just one aspect of what members can do in The Registry Collection® program. Members also have access to personal concierge services* 24 hours a day, seven days a week whether they are at home or on vacation.

Services provided to members range from the simple, such as dinner reservations or tickets to a show, to more complex arrangements, such as event planning, gift shopping, product research or exotic travel.

*The services of the personal concierge are at no cost to members. The only cost is for the actual product or service purchased.

A COMMITMENT TO QUALITY

The Registry Collection® exchange program has developed robust Product Affiliate Guidelines to ensure the highest quality of product and service delivery. The Product Affiliate Guidelines use three distinct methods to drive quality:

Published quality standards for affiliation Inspections Member feedback

The published quality standards ensure that each new affiliated luxury leisure accommodation meets the standards of the exchange program before their participation begins. Inspections developed from a third-party entity validate the assurance of continued quality of the affiliated luxury leisure properties within the network. In addition to inspections, feedback from members is gathered via comment cards.

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Since October 2009, affiliates of The Registry Collection program have been able to use The Registry Collection Web site to pull comment card data submitted by members exchanging into their property. The ratings are based on member feedback surrounding resort accommodations, amenities, property services and overall vacation experience. The survey also includes questions regarding the member’s vacation planning experience with The Registry Collection Travel Consultant. While the system does not allow affiliates to specifically compare their property to another property, these reports are a great benchmarking tool for affiliates of The Registry Collection program.

QUALITYSTANDARDS

MEMBERFEEDBACKINSPECTIONS

DELIVERING ON THE PROMISE

The Registry Collection® program also delivers on its promise of world-class customer service. To ensure that this promise is met, our reservation consultants are selected based on exacting standards that include the use of a job analysis report and profile benchmark tool. The right people are placed in the right jobs to drive customer satisfaction, using a three-step customized training program to hone the skills of everyone on the front lines of service delivery, focusing on: 1) core product knowledge; 2) commitment to excellence; and 3) training in industry knowledge and support. Our call center standards and monitoring programs round out the overall service delivery of quality assurance.

The programs are working well. Based on 2009 member survey data, member satisfaction levels for the properties of The Registry Collection program included the following:

Availability of desired location

Availability of travel dates

Property info provided by staff

Staff knowledge of policies

Staff courteousness and helpfulness

Overall service provided by staff

Information provided by the property

Amenities at the property

Off-site attractions and amenities

Quality of accommodations

Your personalized experience

91%

90%

91%

93%

96%

94%

89%

89%

89%

93%

89%

2004

72 207

1,409

3,394

6,670

8,125*

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

2005 2006 2007 2008 2009

�e Registry Collection Global Exchange Transactions

* Unaudited number as of 12/31/09

Understanding Credits

The Interval* of time you deposited is worth a designated number of Credits in The Registry Collection® system. The same is true of the Intervals of time at every other property in the The Registry Collection program. These Credits are how you make an exchange reservation for a holiday at any of the other properties in the Portfolio. Depositing An Interval This is how you gain Credits in order to make an exchange reservation. You may deposit Intervals from your resort anytime 365 to 120 days in advance of the check-in date of the interval you are depositing. Intervals can only be deposited in increments of 7 nights unless otherwise noted. Making the Exchange Reservation Once you make a reservation for a property in the The Registry Collection program, you exchange your Credits to complete the transaction.

*As such term is used in The Registry Collection 2009-2010 disclosure guide.

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TESTIMONIALS

The following are testimonials taken from our members’ comment cards:

“We just returned from a one-week vacation at Montecristo Estates in Cabo San Lucas. This is a 5-star villa with impeccable service. The gourmet kitchen had everything one would need and made it even more tempting to stay in at night and barbeque while sitting on our patio. The ocean view was spectacular while floating in our gorgeous infinity pool. I cannot wait to go back for another week…or two!”-S. D. W.

“[Highly trained Registry Collection Consultant] Kimeron …was extremely pleasant to talk to and called me back within minutes to tell me she had found a unit that I might be interested in. This is something she did not have to do. I was extremely thankful for her going out of the way to make my experience even better. All the counselors at The Grand Mayan Registry Collection have shown these qualities and I continue to rave about their performance and ability to communicate. They are extraordinary.”-Dr. and Mrs. J. T. B.

“To our surprise [The Mountain Club at Cashiers greeted us with] warm white Christmas lights decorating the porch, truly a welcome sight and such a nice touch. Upon entering the beautiful home, lights were on in anticipation of our arrival, and a live, decorated Christmas tree filled the house with such a pleasant aroma, with soft Christmas music in the background. The incredible live floral arrangement on the dining table only added to the heartfelt welcoming. We couldn’t have asked for a nicer arrival. For the first time in many hours of travel, we felt safe, sound and at peace at this wonderful home…The staff were kind and helpful when needed. We truly loved our visit and hope to return again.” -LaDawn and David Z.

TRENDS TO WATCH IN 2010

GOING FORWARD TOGETHER

The growing trend toward the purchase of the experience rather than a distinct product is defined as “transumerism.” According to trendwatching.com, “transumers” are adopting a “leasing lifestyle” making use of rental options that go beyond the traditional. This trend is a natural outgrowth of experiential marketing strategies, where what consumers feel when using the product transcends the possession and price of the product itself.

The Registry Collection® program strives to meet the experiential requirements of these affluent consumers who wish to become “fluent” in luxury experiences, by maximizing their exposure to a variety of travel options and venues that are significantly upscale, reaching beyond the merely unique to the extraordinary. The Registry Collection program offers this market segment a one-stop shop, with access to some of the finest resorts and destinations around the globe—and offers its developers opportunities for business growth.

As the global leader in the luxury assets exchange segment, The Registry Collection program is committed to expanding its portfolio of unique experiential offerings in 2010 and the coming years, while providing superlative service to our member families and developer affiliates. As the program grows, superb service delivery will continue to be standard, as will our commitment to quality assurance.

For more information on The Registry Collection program, please visit theregistrycollection.com or call us at 866-937-5979.

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The Registry Collection®

866-937-5979

7 Sylvan Way, Parsippany, NJ 07054

The Registry Collection and related marks are registered trademarks and/or service marks in the United States and internationally. All rights reserved. © 2010 RCI, LLC. All Rights Reserved. Printed in Mexico.